To prevent segregating the poor into inconveniently located bad housing with crime and pollution, we need to make some safe, solid housing available closer in, integrated with the rich people's housing. that is still affordable. In order to do that, we need to allow housing that's cheap in the non-dangerous, non-segregated ways. That means housing that's small or ugly, with crappy views and no doormen. Maybe housing that allows loud music if it doesn't bother anyone else. Regardless, it should still be well-built and well-maintained, and safe from pollution and crime.
Stephen Smith is fond of saying that "filtering" will keep prices low on a large enough portion of the available housing. Filtering is the idea that the price of older housing will be lower, reflecting the aging of materials and changes in consumer tastes. Jane Jacobs memorably said it about commercial space: "New ideas require old buildings."
This filtering hypothesis would make sense, all else being equal, but all else is not equal. There has been a serious decline in the quality of building since World War II, with the result that many buyers and renters will choose a prewar apartment with its amenities (hardwood floors, high ceilings, attention to detail, solid construction) over a postwar one with "modern" amenities (Stephen recently mentioned central air conditioning and laundry on premises).
A lot of postwar construction is also anti-urban, even in the hearts of cities, whether through tower-in-a-park architecture like Stuyvesant Town or excessive auto-oriented design like big driveways. Some, like the Big Six towers in my neighborhood, combined the two for that classy tower-in-a-parking lot ambiance. Some, like Wesley Grove in Asbury Park, have their de facto primary entrances and exits facing away from the street and towards the parking lot.
Because of this, it helps to have other ways of generating a range of quality options in the housing market, and one of those is elevated trains. I may have picked this idea up from something Stephen wrote; he certainly likes els.
Now, the el in my neighborhood, the Flushing Line, is really not that nice. In addition to blocking out all the light on Roosevelt Avenue, it makes so much noise that you can't talk when it's clanking over you. And if you look at estimated rents on Zillow, you'll find that two-bedroom apartments facing the train tend to rent for several hundred dollars cheaper than those around the corner.
Els that are built nowadays are much quieter. They're not unpleasant to live near, but they aren't as nice as a subway. The result is a less extreme range of rents, but still enough to provide affordable housing, especially when combined with other factors.
Elevated trains are not only cheaper to build than subways, but when combined with zoning that allows for substantial amounts of housing to be built for relatively low cost (i.e. highrises without parking) they can provide genuine affordable housing, and thus be a real tool in fighting gentrification.